##### Scenario II

##### Trust Fund Balances Precluded From Obligation

Certain trust funds fall under a requirement whereby any unobligated balances remaining at yearend must be classified as temporarily not available and, in effect, temporarily removed from budget execution.  This requirement applies only to funds wherein receipts are immediately appropriated, but are precluded from obligation at yearend by a provision of law, such as a benefit formula or limitation.  This authority can be precluded during the year (i.e., by legislation) but is more commonly seen with trust funds at the end of the year (i.e., for trust funds with legislative provisions that contain a benefit formula or limitation on obligations).  Some of the larger dollar-value and commonly known trust funds fit into this category. Examples of these types of trust funds are the Federal Old-Age and Survivor's Insurance Trust Fund, Federal Hospital Insurance Trust Fund, and Unemployment Trust Fund.

Reporting guidelines stipulate that the yearend SF 133 must agree with the P&F in the Budget.  Furthermore, there is a relationship between Schedule N: Schedule of Unavailable Collections (which precedes the P&F in the Budget) and the P&F.  The Schedule N and P&F together, as well as the yearend SF 133, should reflect that the amount of current-year receipts less obligations equals amounts precluded from obligation.  In addition, budgetary reporting of these trust funds reflects no beginning or ending unobligated balances available for obligation.

During the year, appropriated receipts are recorded as new budget authority on Line 1A of the SF 133, while at the same time obligations are incurred.  On September 30th, any remaining unobligated balances become temporarily precluded from obligation, and are subtracted from budget authority on Line 5 of the SF 133.  This process results in a zero unobligated balance on both the SF 133 and P&F.  However, the balances remain on Schedule N until such time as needed when current-year receipts are not enough to cover current-year obligations.  Furthermore, the unobligated balances are to be included on the USSGL 2108, Column 11, Unobligated Balances.

To account for this type of activity, the following budgetary USSGL accounts were established to ensure accurate reporting on the SF 133, USSGL 2108, and multiple lines of the P&F: 

4157Authority Made Available from Receipt or Appropriation Balances Previously Precluded from Obligation

4158Authority Made Available from Offsetting Collections Balances Previously Precluded from Obligation

4397Receipts and Appropriations Temporarily Precluded from Obligation

4398Offsetting Collections Temporarily Precluded from Obligation

USSGL accounts 4397 and 4398 are recorded to temporarily preclude receipts or offsetting collections from obligation.  These accounts are credited at yearend against any remaining unobligated balances and remain open.  On the SF 133, they crosswalk to Line 5, Temporarily Not Available Pursuant to Public Law, as fiscal year amounts and are subtracted to bring total budgetary resources to zero.  The beginning balances are carried forward to Line 2A, Unobligated Balance Brought Forward, the following year, but are netted against total actual resources collected, thus resulting in a zero balance on Line 2A.  On the USSGL 2108, these accounts crosswalk to Column 11, Unobligated Balances, and represent invested balances.  This causes a disconnect between the unobligated balances reported on the SF 133 and USSGL 2108, with the difference captured in USSGL accounts 4397 and 4398. 

USSGL accounts 4157 and 4158 are recorded to return authority to the trust fund if current-year receipts are not enough to cover current-year obligations.  The "returned" authority is treated as new budget authority on the SF 133.  However, if the trust fund's total current-year receipts are greater than total current-year obligations, then these accounts must be adjusted to zero prior to submitting the FACTS II ATB (preclosing entry).    If, on the other hand, the trust fund's total current-year receipts are not enough to cover current-year obligations, then these accounts are closed as part of the post-closing entries.  The following scenario illustrates each of these concepts.

**Year 1** illustrates the proper entries for a trust fund where the total amount of current-year receipts is greater than total current-year obligations.

**Year 2** illustrates authority returned to the trust fund in order to cover obligations, and the corresponding entries where the total amount of current-year receipts at yearend is greater than the amount that was needed to cover current-year obligations.

**Year 3** illustrates authority returned to the trust fund to cover obligations, and the corresponding entries where the total amount of current-year receipts at yearend is not enough to cover current-year obligations.

Year 1

**1.To record appropriated receipts from Federal sources into a trust fund.  The receipts are deposited into an available trust fund receipt account, and are automatically credited to the corresponding expenditure account.  Assume a portion of the receipts is subject to apportionment.  (TC A186)**

***Budgetary***

4114Appropriated Trust or Special Fund Receipts500

4450Unapportioned Authority100

4620Unobligated Funds Not Subject to Apportionment400

***Proprietary***

1010Fund Balance with Treasury500

5800Tax Revenue Collected500

**2.To record reimbursable activity between a trust fund and another Federal fund for work performed under the Economy Act.  Offsetting collections are recorded directly to trust fund expenditure accounts.  Assume offsetting collections for this program are subject to apportionment.**

**A.To record anticipated reimbursements. (TC A302)**

***Budgetary***

4210Anticipated Reimbursements and Other Income700

4450Unapportioned Authority700

***Proprietary***

None

B. **To record anticipated resources apportioned, based upon an approved SF 132: Apportionment or Reapportionment Request, but not yet available for use.  (TC A118)**

***Budgetary***

4450Unapportioned Authority550

4590Apportionments Unavailable - Anticipated Resources550

***Proprietary***

None

C. **To record a reimbursable agreement with an advance and to realize previously anticipated and apportioned authority.  (TC A122, C182)**

***Budgetary***

4222Unfilled Customer Orders With Advance550

4210Anticipated Reimbursements and Other Income550

and

4590Apportionments Unavailable - Anticipated Resources550

4610Allotments - Realized Resources550

***Proprietary***

1010 Fund Balance With Treasury550

2310Advances from Others550

D. **To incur obligations.  (TC B204)**

***Budgetary***

4610Allotments - Realized Resources550

4801Undelivered Orders - Obligations, Unpaid550

***Proprietary***

None

E. **To record earned revenue related to the reimbursable agreement.  (TC A306)**

***Budgetary***

4252Reimbursements and Other Income Earned - Collected550

4222Unfilled Customer Orders With Advance550

***Proprietary***

2310Advances from Others550

5200Revenue from Services Provided550

F. **To record services performed and expenses incurred.  (TC B107)**

***Budgetary***

4801 Undelivered Orders - Obligations, Unpaid550

4902 Delivered Orders - Obligations, Paid550

***Proprietary***

6100 Operating Expenses/Program Costs550

1010Fund Balance With Treasury550

3. **To record obligation, expenditure and disbursement of funds to non-Federal recipients against portion of receipts collected in transaction 1.  (TC B107)**

***Budgetary***

4620Unobligated Funds Not Subject to Apportionment225

4902Delivered Orders - Obligations, Paid225

***Proprietary***

6100Operating Expenses/Program Costs225

1010Fund Balance with Treasury225

**Year 1**

**Budgetary Adjusting Entries:**

For trust funds wherein receipts are precluded from obligation at year-end, record the following **pre-closing** entries.  These entries are to be made prior to submitting FACTS II ATB's.  Note that these entries may also be made during the year if specified by law.

**A1)To record adjustments for anticipated resources not realized.  (TC F112)**

****4450****Unapportioned Authority150

****4210Anticipated Reimbursements and Other Income150

**A2)To record unobligated balances of appropriated receipts temporarily precluded from obligation.  (TC A127)**

****4620Unobligated Funds Not Subject to Apportionment175

4397****Receipts and Appropriations Temporarily Precluded from Obligation 175

**A3)To record unobligated balances of offsetting collections temporarily precluded from obligation. (TC A129)**

****4450Unapportioned Authority100

4398****Offsetting Collections Temporarily Precluded from Obligation100

**Year 1**

**Budgetary Pre-Closing Adjusted Trial Balance (FACTS II ATB):**

**Budgetary Closing Entries:**

**C1.To record the consolidation of actual net-funded resources.  (TC F204)**

## 4201Total Actual Resources - Collected  1,050

4114Appropriated Trust or Special Fund Receipts500

4252Reimbursements and Other Income Earned - Collected550

**C2.To record the closing of Expended Authority - Paid.  (TC F214)**

4902Delivered Orders - Obligations, Paid775

4201Total Actual Resources - Collected775

**Budgetary Post-Closing Trial Balance:**

**Year 1**

**Proprietary Pre-Closing Trial Balance (FACTS I Trial Balance):**

**Proprietary Closing Entries:**

**C1.To record the closing of revenues and expenses to cumulative results of operations.  (TC F228)**

5200Revenue from Services Provided550

5800Tax Revenue Collected500

**3310Cumulative Results of Operations275**

6100Operating Expenses/Program Costs775

**Proprietary Post-Closing Trial Balance:**

**Year 1**

**SF 133: Report on Budget Execution and Budgetary Resources (Quarter 4):**

1AAppropriations  (4114E)  500

2AUnobligated Balance Brought Forward

3A1Spending Authority from Offsetting Collections, Earned, Collected (4252E) 550

5Temporarily Not Available Pursuant to P.L.  (4397E-B, 4398E-B)(275)

**7Total Budgetary Resources  775**

8A1Obligations Incurred, Direct  (4902E) 550

8A3Obligations Incurred, Direct, Not Subject to Apportionment  (4902E) 225

9Unobligated Balances Available     0

**11Total Status of Budgetary Resources 775**

12.Obligated Balance, Net as of October 1

13.Obligated Balance Transferred, Net

14.Obligated Balance, Net, End of Period

15A.Disbursements   (4902E)775

15B.Collections  (4252E)550

**USSGL 2108: Year-end Closing Statement:**

Column 5Post-Closing Unexpended Balance (1010E)275

Column 11Unobligated Balance  (4397E, 4398E)275

**Year 1**

**Schedule P - Program & Financing:**

**Obligations by Program Activity**

1000Total new obligations (4902E) 775

**Budgetary Resources Available for Obligation**

2200New budget authority (gross) (sum 4000 to 6990) 775

2395Total new obligations (-) (from line 1000)(775)

2499Total unobligated balance, end of year     0

**New Budgetary Authority (Gross) Detail**

6027Appropriation (trust fund, indefinite) (4114E) 500

6045Portion precluded from obligation (-) (4397E-B)(175)

6800Discr spend authority from offsetting collections (4252E) 550

6845Portion unavailable for obligation (-) (4398E-B)(100)

7000Total new budget authority (gross) (4114E+4252E+4397E-B+4398E-B) 775

**Year 1OMB Form and Content Statements**

**Year 1OMB Form and Content Statements (continued)**

**Year 2**(Year 2 illustrates authority returned to the trust fund in order to cover obligations, and the corresponding entries where the total amount of current-year receipts at year-end is greater than the amount that was needed to cover current-year obligations.)

**1.To record appropriated receipts from Federal sources into a trust fund.  The receipts are deposited into an available trust fund receipt account, and are automatically credited to the corresponding expenditure account.  Assume the receipts are not subject to apportionment.  (TC A186)**

***Budgetary***

4114Appropriated Trust or Special Fund Receipts600

4620Unobligated Funds Not Subject to Apportionment600

***Proprietary***

1010Fund Balance with Treasury600

5800Tax Revenue Collected600

**2a.To record the obligation, expenditure and disbursement of funds to non-Federal recipients.  *Note that at the time of obligation, current year receipts are not enough to cover obligations.*(TC B107)**

***Budgetary***

4620Unobligated Funds Not Subject to Apportionment750

4902Delivered Orders - Obligations, Paid750

***Proprietary***

6100Operating Expenses/Program Costs750

1010Fund Balance with Treasury750

- and -

**Year 2**

**2b.To record authority made available from previously unavailable balances.  (TC A192, A194)**

(Calculation:  $600 received - $750 to be expended = $150 to be covered by balances collected in prior years)

***Budgetary***

4157Authority Made Available from Receipt or Appropriation Balances Previously

Precluded from Obligation75

4158Authority Made Available from Offsetting Collections Balances Previously

Precluded from Obligation75

4620Unobligated Funds Not Subject to Apportionment150

***Proprietary***

None

**3.To record additional appropriated receipts into the trust fund.  (TC A186)**

***Budgetary***

4114Appropriated Trust or Special Fund Receipts500

4620Unobligated Funds Not Subject to Apportionment500

***Proprietary***

1010Fund Balance with Treasury500

5800Tax Revenue Collected500

**Year 2**

**Budgetary Adjusting Entries:**

**A1)To record unobligated balances of appropriated receipts temporarily precluded from obligation. (TC A127)**

****4620Unobligated Funds Not Subject to Apportionment500

4397****Receipts and Appropriations Temporarily Precluded from Obligation     500

**A2)To reduce balances previously precluded from obligation by the amount that was needed in the current year to cover obligations.  NOTE:  Record this entry as pre-closing when the total amount of current-year receipts is greater than the amount needed to cover current-year obligations.  (TC F132, F134)**

****4397Receipts and Appropriations Temporarily Precluded from Obligation75

4157 Authority Made Available from Receipt or Appropriation Balances

Previously Precluded from Obligation75

4398Offsetting Collections Temporarily Precluded from Obligation75

4158 Authority Made Available from Offsetting Collections Balances

Previously Precluded from Obligation     75

**Year 2**

**Beginning Budgetary Trial Balance:**

**Budgetary Pre-Closing Adjusted Trial Balance (FACTS II ATB):**

**Budgetary Closing Entries:**

**C1.To record the consolidation of actual net-funded resources.  (TC F204)**

4201Total Actual Resources - Collected1,100

4114Appropriated Trust or Special Fund Receipts1,100

**C2.To record the closing of Expended Authority - Paid.  (TC F214)**

4902Delivered Orders - Obligations, Paid750

****4201Total Actual Resources - Collected750

**Year 2**

**Budgetary Post-Closing Trial Balance:**

**Year 2**

**Beginning Proprietary Trial Balance:**

**Proprietary Pre-Closing Adjusted Trial Balance (FACTS I ATB):**

**Proprietary Closing Entries:**

**C1.To close revenues and expenses into cumulative results of operations.  (TC F228)**

5800Tax Revenue Collected1,100

6100Operating Expenses/Program Costs750

**3310Cumulative Results of Operations350**

**Proprietary Post-Closing Trial Balance:**

**Year 2**

**SF 133: Report on Budget Execution and Budgetary Resources (Quarter 4):**

1AAppropriations  (4114E)1,100

2AUnobligated Balance Brought Forward (4201B+4397B+4398B)       0

3A1Spending Authority from Offsetting Collections

5Temporarily Not Available Pursuant to P.L.  (4397E-B, 4398E-B) (350)

**7Total Budgetary Resources    750**

8A3Obligations Incurred, Direct, Not Subject to Apportionment  (4902E)  750

9Unobligated Balances Available      0

**11Total Status of Budgetary Resources  750**

12.Obligated Balance, Net as of October 1

13.Obligated Balance Transferred, Net

14.Obligated Balance, Net, End of Period

15A.Disbursements   (4902E)  750

**USSGL 2108: Year-end Closing Statement:**

Column 5Post-Closing Unexpended Balance (1010E)   625

Column 11Unobligated Balance  (4397E+4398E)   625

**Year 2**

**Schedule P - Program & Financing**

**Obligations by Program Activity**

1000Total new obligations (4902E)  750

**Budgetary Resources Available for Obligation**

2200New budget authority (gross) (sum 4000 to 6990)  750

2395Total new obligations (-) (from line 1000)(750)

2499Total unobligated balance, end of year****     0

###### New Budgetary Authority (Gross) Detail

6027Appropriation (trust fund, indefinite) (4114E)  1,100

6028Appropriation (unavailable balances) (4157E)        0

6045Portion precluded from obligation (-) (4397E-B) (425)

6800Discr spend authority from offsetting collections

6826/6926 From offsetting collections (unavailable balances) (4158E)       0

6845Portion unavailable for obligation (-)(4398E-B)     75

7000Total new budget authority (gross) (4114E+4157E+4158E+4397E-B+4398E-B)   750

**Year 2OMB Form and Content Statements**

**Year 2OMB Form and Content Statements (continued)**

**Year 3**(Year 3 illustrates authority returned to the trust fund in order to cover obligations, and the

corresponding entries where the total amount of current-year receipts at year-end is not enough to cover current-year obligations.)

**1.To record appropriated receipts into a trust fund.  The receipts are deposited into an available trust fund receipt account, and are automatically credited to the corresponding expenditure account.  Assume the receipts are not subject to apportionment.  (TC A186)**

***Budgetary***

4114Appropriated Trust or Special Fund Receipts1,000

4620Unobligated Funds Not Subject to Apportionment1,000

***Proprietary***

1010Fund Balance with Treasury1,000

5800Tax Revenue Collected1,000

**2a.To record the obligation, expenditure and disbursement of funds.  *Note that at the time of obligation, current year receipts are not enough to cover obligations.*  (TC B107)**

***Budgetary***

4620Unobligated Funds Not Subject to Apportionment1,200

4902Delivered Orders - Obligations, Paid1,200

***Proprietary***

6100Operating Expenses/Program Costs1,200

1010Fund Balance with Treasury1,200

- and -

**2b.To record authority made available from previously unavailable balances.  (TC A192)**

***Budgetary***

4157Authority Made Available from Receipt or Appropriation Balances Previously

Precluded from Obligation200

4620Unobligated Funds Not Subject to Apportionment200

***Proprietary***

None

**Year 3**

**3.To record additional appropriated receipts into the trust fund.  (TC A186)**

***Budgetary***

4114Appropriated Trust or Special Fund Receipts100

4620Unobligated Funds Not Subject to Apportionment100

***Proprietary***

1010Fund Balance with Treasury100

5800Tax Revenue Collected100

**Budgetary Adjusting Entries:**

**A1)To record unobligated balances of appropriated receipts temporarily precluded from obligation. (TC A127)**

****4620Unobligated Funds Not Subject to Apportionment100

4397****Receipts and Appropriations Temporarily Precluded from Obligation     100

**Year 3**

**Beginning Budgetary Trial Balance:**

**Budgetary Pre-Closing Adjusted Trial Balance (FACTS II ATB):**

**Budgetary Closing Entries:**

**C1)To record the consolidation of actual net-funded resources.  (TC F204)**

### 4201Total Actual Resources - Collected1,100

### 4114Appropriated Trust or Special Fund Receipts1,100

**C1)To record the closing of Expended Authority - Paid.  (TC F214)**

4902Delivered Orders - Obligations, Paid1,200

4201Total Actual Resources - Collected1,200

Year 3

**C2)To reduce balances previously precluded from obligation by the amount that was needed in the current year to cover obligations.  NOTE:  Record this entry as post-closing when the total amount of current-year receipts is not enough to cover current-year obligations.  (TC F242)**

4397Receipts and Appropriations Temporarily Precluded from Obligation200

4157Authority Made Available from Receipt or Appropriation Balances

Previously Precluded from Obligation200

**Budgetary Post-Closing Trial Balance:**

**Year 3**

**Beginning Proprietary Trial Balance:**

**Proprietary Pre-Closing Trial Balance (FACTS I Trial Balance):**

**Proprietary Closing Entries:**

**C1.To close revenues and expenses into cumulative results of operations.  (TC F228)**

5800Tax Revenue Collected1,100

#### 3310Cumulative Results of Operations   100

6100Operating Expenses/Program Costs1,200

**Proprietary Post-Closing Trial Balance:**

**Year 3**

**SF 133: Report on Budget Execution and Budgetary Resources (Quarter 4):**

1AAppropriations  (4114E+4157E+4158E)1,300

2AUnobligated Balance Brought Forward (4201B+4397B+4398B)       0

3A1Spending Authority from Offsetting Collections

5Temporarily Not Available Pursuant to P.L.  (4397E-B, 4398E-B) (100)

**7Total Budgetary Resources 1,200**

8A3Obligations Incurred, Direct, Not Subject to Apportionment  (4902E)1,200

9Unobligated Balances Available       0

**11Total Status of Budgetary Resources1,200**

12.Obligated Balance, Net as of October 1

13.Obligated Balance Transferred, Net

14.Obligated Balance, Net, End of Period

15A.Disbursements   (4902E)1,200

**USSGL 2108: Year-end Closing Statement:**

Column 5Post-Closing Unexpended Balance (1010E)525

Column 11Unobligated Balance  (4157E+4158E+4397E+4398E)525

**Year 3**

**Schedule P - Program & Financing:**

**Obligations by Program Activity**

1000Total new obligations (4902E)  1,200

**Budgetary Resources Available for Obligation**

2200New budget authority (gross) (sum 4000 to 6990)  1,200

2395Total new obligations (-) (from line 1000)(1,200)

2499Total unobligated balance, end of year****0

**New Budgetary Authority (Gross) Detail**

6027Appropriation (trust fund, indefinite) (4114E)  1,100

6028Appropriation (unavailable balances) (4157E)    200

6045Portion precluded from obligation (-) (4397E-B)  (100)

6800Discr spend authority from offsetting collections

6826/6926 From offsetting collections (unavailable balances) 

6845Portion unavailable for obligation (-)(4398E-B)       0

7000Total new budget authority (gross) (4114E+4157E+4158E+4397E-B+4398E-B)1,200

**Year 3OMB Form and Content Statements**

**Year 3****OMB Form and Content Statements (continued)**

� The transactions in this scenario combine the activity of the receipt and expenditure accounts.  The receipt-expenditure account relationship is described in more detail in the Introduction of the Guide.

� Generally all trust fund receipts and collections are recorded into USSGL account 4114 Appropriated Trust or Special Fund Receipts.  An exception exists for work performed under the Economy Act, for which the collections are recorded as offsetting and netted against outlays.

� Compare with Year 3 where the total amount of current-year receipts at year-end is not enough to cover current-year obligations.  The difference is in whether an adjusting entry or closing entry is required to reduce USSGL accounts 4157 and 4158.

� The unavailable balances from prior years are captured in USSGL accounts 4397 or 4398.  Refer to Year 1 of this scenario for the original transactions. 

� Record this entry as post-closing when the total amount of current-year receipts is not enough to cover current-year obligations.  Refer to Year 3 of this scenario for an illustration.  Note that alternative methods may be used to achieve the same result.

� Compare with Year 2 where the total amount of current-year receipts at year-end is greater than the amount that was needed to cover current-year obligations.  The difference is in whether an adjusting entry or closing entry is required to reduce USSGL accounts 4157 and 4158.

� Record this entry as pre-closing when the total amount of current-year receipts is greater than the amount needed to cover current-year obligations.  Refer to Year 2 of this scenario for an illustration.  Note that alternative methods may be used to achieve the same result.

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June 2001